Bradley Solutions and Alexander Limited are two well-established suppliers of inexpensive tools. Weekend Projects is a national chain of retail outlets that caters to the occasional fixer-upper who would prefer to get the job done fast rather than investing in a well-appointed tool box. Weekend Projects wants to find a supplier for a particular tool set that promises to be a big seller. Expected annual sales are 100,000 units (D). Weekend's warehouses operate 50 weeks a year. Management collected data on the two suppliers, which are contained in the table below: Annual Freight Costs Shipping Quantity (Q) Price/Unit Annual Holding Lead Time (L) (p) $9.15 $9.15 Annual 10,000 $40,000 $28,000 $18,000 $35,000 $26,000 50,000 (wks) Supplier Bradley Alexander 25,000 Cost/Unit (H) Administrative Cost $1.83 $1.83 $10,000 $15,000 $17,000 7 a. Which of the two suppliers would provide the lowest annual cost to Weekend Projects? What shipping quantity would you suggest? Using and a shipping quantity of V units is the lowest cost alternative, with annual total costs to Weekend Projects of $ (Enter your response as an integer.)
Bradley Solutions and Alexander Limited are two well-established suppliers of inexpensive tools. Weekend Projects is a national chain of retail outlets that caters to the occasional fixer-upper who would prefer to get the job done fast rather than investing in a well-appointed tool box. Weekend Projects wants to find a supplier for a particular tool set that promises to be a big seller. Expected annual sales are 100,000 units (D). Weekend's warehouses operate 50 weeks a year. Management collected data on the two suppliers, which are contained in the table below: Annual Freight Costs Shipping Quantity (Q) Price/Unit Annual Holding Lead Time (L) (p) $9.15 $9.15 Annual 10,000 $40,000 $28,000 $18,000 $35,000 $26,000 50,000 (wks) Supplier Bradley Alexander 25,000 Cost/Unit (H) Administrative Cost $1.83 $1.83 $10,000 $15,000 $17,000 7 a. Which of the two suppliers would provide the lowest annual cost to Weekend Projects? What shipping quantity would you suggest? Using and a shipping quantity of V units is the lowest cost alternative, with annual total costs to Weekend Projects of $ (Enter your response as an integer.)
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Transcribed Image Text:Bradley Solutions and Alexander Limited are two well-established suppliers of inexpensive tools. Weekend Projects is a national chain of retail outlets that caters to
the occasional fixer-upper who would prefer to get the job done fast rather than investing in a well-appointed tool box. Weekend Projects wants to find a supplier for a
particular tool set that promises to be a big seller. Expected annual sales are 100,000 units (D). Weekend's warehouses operate 50 weeks a year. Management
collected data on the two suppliers, which are contained in the table below:
Annual Freight Costs
Shipping Quantity (Q)
Annual
Price/Unit Annual Holding Lead Time (L)
Cost/Unit (H)
$1.83
$1.83
50,000
Supplier
Bradley
Alexander
10,000
25,000
$28.000
(wks)
(p)
$9.15
$9.15
Administrative Cost
$40,000
$35,000
$18,000
$17,000
$10,000
$15,000
$26,000
7
a. Which of the two suppliers would provide the lowest annual cost to Weekend Projects? What shipping quantity would you suggest?
Using
and a shipping quantity of
units is the lowest cost alternative, with annual total costs to Weekend Projects of $
(Enter your response
as an integer.)
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